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October 2, 2013

Top 20 Most Valuable Brands in the World: 2013

Tech, automotive sectors lead the top 20 strongest global brands

Interbrand, a brand consultancy firm, released its list of the top 100 global brands on Monday. Among the firm’s extensive methodology, three aspects to determine a brand’s value stood out: financial performance; its role in influencing consumer choice; and ability to command a premium price or secure earnings for the company.

Interbrand found technology firms were the most valuable overall sector, with a combined value of over $443 billion.

Interestingly, though they didn’t make it into the top 20, eight of the 11 financial services brands on the list saw in increase in brand value. American Express, Goldman Sachs and Visa all saw double-digit increases in brand value over 2012.

To be included in the list, brands must acquire at least 30% of revenue from outside their home country and must have a presence on at least three continents. Interbrand also looked for firms with publicly available financial information and expected long-term growth.

Although Honda also offers aviation and robotics, the firm is known primarily as a car company. Its efforts in hybrid cars served it well, and it was one of four brands that sold over 5 million vehicles at the beginning of 2013. “Honda has a long history of innovation, and its reputation for more robust fuel-efficiency technology helps support the premium while connecting with consumers that have stronger environmental awareness.”

In the future, Interbrand said, it won’t be able to rely solely on consumer loyalty, though, and will have to closer relationships with its customers.

Through its focus on customer experience and initiatives like the Amazon Appstore, which provides product recommendations on Kindle and Android devices, Amazon has built intimate relationships with its customers, Interbrand said. However, the firm needs to rein in some of its more elaborate expansion plans to preserve its reputation. “Looking ahead, CEO Jeff Bezos (who raised eyebrows with his personal surprise purchase of the Washington Post) and his leadership team must be mindful of local needs to deliver a consistent Amazon brand experience to a global audience.”

Oracle is a leading provider of hardware and software systems for businesses, but it’s struggling with an image of irrelevance, Interbrand said. “As brands with loyal users, such as Google, continue to play a leading role in the technology sector, Oracle must ramp up its brand messaging efforts and initiatives, establishing stronger emotional connections with consumers.”

The success of Louis Vuitton Moet Hennessy comes from maintaining a feeling of exclusivity, according to Interbrand. “To prevent the risk of overexposure, the brand is concentrating on limiting its own visibility.”

Gillette’s parent company, Proctor & Gamble, owns 70% of the market for razors and blades, according to Interbrand. Social media and sports partnerships drive much of that success—one campaign that automatically tagged runners who entered their bib number in photos of the Malta Marathon generated 870,000 views of the company’s Facebook page.

HP has made significant changes in identity over the past few years, something that could make the company appear unstable, according to Interbrand. It announced in June that it’s partnering with Google to offer small- to medium-sized businesses comprehensive IT solutions, and is expected to launch a new smartphone soon, possible before the end of the year.

“HP has failed here in the past with the acquisition and subsequent shutdown of Palm, so industry pundits see the resurrection of a mobile division as a critical moment in HP’s turnaround story.”

The Disney empire doesn’t end at movies and television. Interbrand noted the firm’s vertical and horizontal integration allows it to expand franchises to merchandise, theme parks, resorts, DVDs and video games. The firm tends to rely too heavily on box-office hits, however.

“As long as Disney can continue to evolve how its core brand delivers against the ideas that have made it relevant for generations, the company will continue to be one of the world’s most valuable entertainment and media powerhouses for the foreseeable future,” according to Interbrand.

Cisco is redefining its audience to focus on the business-to-business world, according to Interbrand. “The company is successfully setting itself up to be a go-to for IT leaders looking to make the most out of the new era of interconnected devices, data, and systems.”

BMW was the top selling luxury auto brand in the United States in 2012 and saw a 40% increase in sales in China, according to Interbrand. Its focus on sustainability and mobility are leading the firm’s success. Indeed, electric vehicles are expected to be big sellers in the United States and China, and the company is taking pains to position its i3 and i8 models at the “premium end of the market,” according to Interbrand.

Interbrand noted Mercedes is the No. 1 luxury brand in the United States and Germany, and is growing in prominence in China and Russia. “Part of the secret of its success, exemplified by the new S-class, is its ability to strike a balance between its traditional position and forward-looking ideas around mobility,” according to Interbrand.

Although it started losing brand value in 2008, Interbrand found the company bouncing back, particularly in the United States. A bigger focus on design and more engagement with consumers is pushing Toyota’s renewed growth. “For many brands, the challenges Toyota experienced could have been catastrophic, but the brand’s speedy recovery is a testament to its resilience, leadership position, and the enduring appeal of its offer,” Interbrand said.

Operating under a new leadership team since May, the firm is exploring non-traditional business, Interbrand said. “This will expose Intel to new competitors, but with its deep heritage in innovation and as a driver of trust for consumers, Intel will be competing from a solid brand footing.”

Although it trails Apple in the top brands, it beat the top-ranked brand in smartphone sales in the second quarter. It spent four times more on marketing than Apple in 2012 and its product line includes items that actively work for consumers, like refrigerators that suggest recipes based in what’s inside them.

“Samsung is evolving its brand to stand for more than just innovation and strives to live up to its internal ambition of enhancing the lives of its consumers,” Interbrand said.

“Despite a year of change, the golden arches remains highly relevant to 69 million daily consumers through greater choice and localization, consistent global brand expression and customer experience,” according to Interbrand. Following its first global drop in sales in nine years, CEO Don Thompson shuffled the management team and brought in the first U.S. Chief Brand Officer, Kevin Newell. Modern redesigns at many of its locations, more menu items at lower prices and a push for sustainability are among the factors keeping the company in consumers’ good graces.

Among GE’s innovations is a move to connect Big Data with Big Industry. The firm has invested $1.5 billion to connect industrial technology to enterprise software, according to Interbrand. While growth has been slow this year, it’s been steady.

Microsoft is struggling with some challenges, Interbrand noted. Consumers want more than just a PC from their tech companies and CEO Steve Ballmer announced in August that he plans to retire sometime in the next year. However, the firm is pushing a “One Microsoft” initiative that adopts a holistic approach to its multiple product lines, which are doing well with business audiences. “As Microsoft continues to push on multiple fronts, the brand’s responsiveness to the sometimes conflicting needs of the PC ecosystem and the shifting mobile landscape will be critical for shaping its future,” Interbrand said.

“While IBM’s revenue performance continues to be a point of concern, the brand is hard at work solidifying its brand position as a purveyor of business innovation in the 21st century,” according to Interbrand. As evidence of those efforts, the firm enjoyed record earnings per share, margins and cash flow through 2012 and early 2013, and opened 144 offices in emerging markets in 2012. It also generated nearly 6,500 patents last year, the most U.S. patents for the 20th year in a row.

Even for the least tech-savvy, Google is everywhere you look. Interbrand found Google controls about a third of all online advertising, and its Android phone and operating system competes directly with Apple’s iPhone.

“Google’s relentless adaptation attests to the fact that the brand tries to anticipate and fulfill the needs of its consumers across a variety of areas,” according to Interbrand.

After dominating the list for 13 years, Coke (which hasn’t gone far from the top spot) finally gave way to Apple. Interbrand noted that Apple has “set a high bar for aesthetics, simplicity, and ease of use that all other tech brands are now expected to match, and that Apple itself is expected to continually exceed.”

However, Apple’s place it the top is far from secure. Tech companies have a strong showing in the top 15, not least of which is the behemoth in the No. 2 spot.